energies

Article
LCOE Analysis of Tower Concentrating Solar Power
Plants Using Different Molten-Salts for Thermal
Energy Storage in China
Xiaoru Zhuang, Xinhai Xu * , Wenrui Liu and Wenfu Xu
School of Mechanical Engineering and Automation, Harbin Institute of Technology, Shenzhen 518055, China;
zhuangxiaoru@hit.edu.cn (X.Z.); wenruiliu0817@gmail.com (W.L.); wfxu@hit.edu.cn (W.X.)
* Correspondence: xuxinhai@hit.edu.cn




Received: 11 March 2019; Accepted: 8 April 2019; Published: 11 April 2019


Abstract: In recent years, the Chinese government has vigorously promoted the development
of concentrating solar power (CSP) technology. For the commercialization of CSP technology,
economically competitive costs of electricity generation is one of the major obstacles. However,
studies of electricity generation cost analysis for CSP systems in China, particularly for the tower
systems, are quite limited. This paper conducts an economic analysis by applying a levelized cost of
electricity (LCOE) model for 100 MW tower CSP plants in five locations in China with four different
molten-salts for thermal energy storage (TES). The results show that it is inappropriate to build a
tower CSP plant nearby Shenzhen and Shanghai. The solar salt (NaNO3 -KNO3 , 60-40 wt.%) has
lower LCOE than the other three new molten-salts. In order to calculate the time when the grid parity
would be reached, four scenarios for CSP development roadmap proposed by International Energy
Agency (IEA) were considered in this study. It was found that the LCOE of tower CSP would reach
the grid parity in the years of 2038–2041 in the case of no future penalties for the CO2 emissions. This
study can provide support information for the Chinese government to formulate incentive policies
for the CSP industry.

Keywords: concentrating solar power; levelized cost of electricity (LCOE); molten-salt; tower system;
thermal energy storage

1. Introduction
Concentrating solar power (CSP) technology is one of the most promising renewable energy-based
electricity generation technologies to deal with the increasing demand of power consumption and
environmental sustainability. It can generate renewable electricity from direct sunlight and produce
nearly no greenhouse gas emissions. In addition, compared to photovoltaic (PV) cells, the CSP systems
can deliver dispatchable electricity regardless of the weather conditions by integrating with thermal
energy storage (TES) units. In recent years, the Chinese government has vigorously promoted the
development of CSP technology. The construction of CSP plants in China has increased at a great rate
since starting in 2013 [1]. The installed capacity was about 29.3 MWe by the end of 2017, which was
an increase of 3.53% over that in 2016. Meanwhile, the global installation capacity increase rate was
2.3% [2].
For the commercialization of CSP technology, the low cost of the electricity generation is one of
the major obstacles. Among different types of CSP technologies, the solar power tower technology can
achieve higher operating temperature compared to the parabolic trough and linear Fresnel technologies.
It can yield greater efficiency of thermal-to-electric conversion in the power block and result in lower
cost for TES [1]. As a key factor to evaluate the economic feasibility of CSP systems, the electricity

Energies 2019, 12, 1394; doi:10.3390/en12071394 www.mdpi.com/journal/energies

Energies 2019, 12, 1394 2 of 17

generation cost needs to be appropriately estimated [3,4]. Hernández-Moro and Martínez-Duart [5,6]
established a mathematic model of the levelized cost of electricity (LCOE) for estimating the electricity
generation cost of CSP plants. The future evolution (2010–2050) of the LCOEs based on the International
Energy Agency (IEA) roadmaps for the cumulative installed capacity was predicted. It was found
that the predicted LCOEs strongly depended, not only on the particular values of the cumulative
installed capacity function in the targeted years, but also on the specific curved time-paths followed
by the function. Parrado et al. [7] used the LCOE model to develop an economic analysis for a
50 MW CSP plant with five new storage materials in northern Chile between 2014 and 2050. The
results showed those new molten-salts could reduce the storage costs in CSP plants, especially the
molten-salt composed of Ca(NO3 )2 -NaNO3 -KNO3 (48-7-45 wt.%). Additionally, a comparison for
different locations in three countries (Chile, Spain and USA) was made which indicated that northern
Chile had great potential to implement CSP plants. Hinkley et al. [8] summarized the costs of CSP
plants deployed internationally and estimated the expected costs of trough and tower technologies
in Australia. They found that there was significant potential to reduce the LCOE through operation
at higher temperatures, which would improve the efficiency of a CSP plant. Dieckmann et al. [9]
evaluated the future technical innovations and cost reduction potential for the parabolic trough
and solar tower CSP technologies based on current research and development activities, ongoing
commercial developments, and growth in the market scale. They calculated the LCOEs of those two
technologies in 2015 and 2025 and found that the values matched very well to the published power
purchase agreements (PPA) for the NOOR II and III power plants in Morocco when accounting for
favorable financing conditions. The results also indicated that financing conditions were a major
cost driver and offered potential for further cost reduction. Simsek et al. [10] analyzed the effects
of incentives and financial conditions on the LCOE and government cost for both parabolic trough
and solar tower CSP projects in Chile. The results showed that the debt fraction and discount rate
indicated sensitivities on both the LCOE and government cost. In contrast, debt interest rate only
showed significant sensitivity on the LCOE.
However, the research of electricity generation cost analysis for CSP systems in China, particularly
for the tower systems, are quite limited. As such, the electricity generation cost of CSP systems in
China was reported to be approximately triple in comparison with the current feed-in tariff [6,11–13].
Zhao et al. [13] used a LCOE model to conduct a sensitivity analysis to examine the influences of
investment over the construction period, annual operation and maintenance cost, annual electricity
production, and the discount rate on the LCOE based upon a 50 MW parabolic trough CSP plant with
4 h TES in Erdos, Inner Mongolia. Furthermore, the impacts of incentive policies such as preferential
loans, tax support, and zero land cost for CSP plants were also analyzed. They indicated that the
LCOE could be reduced to 1.173 RMB kWh−1 when those incentive policies functioned in parallel.
Zhu et al. [14] studied and benchmarked the electricity cost of parabolic trough, tower, and dish CSP
technologies in China by applying a LCOE model using plant-specific data in a national CSP database
while cooperating with local CSP experts. The results showed that the LCOEs of 2014 for different
CSP plants were in a range of 1.2–2.7 RMB kWh−1 and tower CSP might be the most promising
CSP technology in China. Li et al. [15] presented an integration analysis of geographic assessment,
technical, and economic feasibility of the parabolic trough, tower, and dish Stirling CSP systems to
investigate their development potential under Chinese conditions in the period of 2010–2050. The
analysis demonstrated that China had sufficient potential for the utilization of parabolic trough and
tower systems. Wu et al. [16] analyzed the effects of solar multiples and full load hours of heat storage
on the generated electricity, net efficiency and LCOE of a Chinese demonstration trough CSP plant. The
results showed that there existed the optimal solar multiples and full load hours of heat storage to reach
the lowest LCOE and realize the highest economic benefit. Yang et al. [17] adopted the static payback
period, net present value, net present value rate, and internal rate of return to calculate and discuss the
cost-benefit of different CSP technologies based on the related data and design parameters of the first
CSP demonstration projects in China. From the project perspective, a vast majority of CSP projects
Energies 2019, 12, 1394 3 of 17

had a strong
Energies 2019, 12,economic
x FOR PEERfeasibility
REVIEW under the current technical level, policy, and resource endowment 3 of 17
of China. The larger TES capacity usually could lead to a good cost-benefit. From the perspective of
technologies,
CSP technology thewas
cost-benefit
better thanof solar
that tower CSP technology
of parabolic trough and was better
linear than that
Fresnel CSPof parabolic trough
technologies. And
andinfluence
the linear Fresnel CSP technologies.
of technology type on And the influence
the cost-benefit ofofCSP
technology
was more type on the cost-benefit
important than that of CSP TES
was more important than that of TES capacity. Ren et al. [18] developed a cost-benefit
capacity. Ren et al. [18] developed a cost-benefit model, which covers the multiple indices of the total model, which
covers the multiple
investment paybackindices
period,ofnet
thepresent
total investment
value perpayback period,
unit installed net present
capacity, valuerate
internal perofunit installed
return, and
capacity,tointernal
LCOE, analyzeratetheofeconomic
return, and LCOE,
benefit of to
CSPanalyze the economic
industry in China. benefit of CSPthat
They found industry in China.
the generated
They found
energy, DNI,that the generated
construction costs,energy, DNI,ratio
and loans construction costs, and
had significant loans
effects on ratio had significant
the economic effects
performance
onCSP
of the economic performance
industry, while of CSPofindustry,
the influences while the influences
operation-maintenance costs ofandoperation-maintenance
interest rate were relatively costs
and interest
smaller rateshould
but still were relatively smaller but still should not be ignored.
not be ignored.
Selecting the most appropriate sites is very critical
Selecting critical for
for CSP
CSP implementation
implementation in in China.
China. Many
geographic conditions need to be be considered
considered such such as
as solar
solar resource,
resource, water
water resource,
resource, energy
energy demand,
demand,
and power grid accessibility [15,19]. In In addition,
addition, considering
considering that that nono specific
specific policies
policies for the CSP
industry have been been enacted
enactedyet yetininChina
China[13],
[13],more
moredata
dataabout
aboutthetheCSPCSPelectricity costcost
electricity is necessary for
is necessary
policy
for makers
policy makersto make decisions.
to make Thus,
decisions. this paper
Thus, conducted
this paper an economic
conducted an economicanalysis by applying
analysis a LCOE
by applying a
model model
LCOE for 100forMW 100tower
MW CSPtower plants
CSP (shown in Figure
plants (shown in 1) in China
Figure 1) inwith
China four different
with molten-salts
four different for
molten-
TES. In
salts forview
TES.of In
theview
geographic
of the conditions,
geographicfive locations five
conditions, with locations
various direct withnormal
variousirradiance (DNI)
direct normal
were selected.
irradiance (DNI)Thewere
calculations
selected.ofThebothcalculations
the presentof (2017)
bothvalue of LCOE
the present and its
(2017) future
value evaluation
of LCOE and for
its
the period
future (2018–2050)
evaluation under
for the period four scenarios under
(2018–2050) proposedfourby the IEA proposed
scenarios (i.e. Blue Mapby the[20],
IEAGlobal Outlook
(i.e. Blue Map
Advanced
[20], Global [21], Global Outlook
Outlook Advanced Moderate [21], and
[21], Global Roadmap
Outlook [22]) were
Moderate presented.
[21], The time[22])
and Roadmap when the
were
CSP grid parities
presented. The timewould
when bethe
attained
CSP grid wasparities
estimated.
would Moreover,
be attained effects
wasofestimated.
the land cost, TES capacity,
Moreover, effects
learning
of the landrate,cost,
discount
TES rate, lifetime,
capacity, degradation
learning rate, operation-maintenance
rate, discount rate, lifetime, degradation cost, and insurance
rate, cost
operation-
on the LCOE cost,
maintenance wereandalsoinsurance
investigated.cost on the LCOE were also investigated.

Figure 1.
Figure Operating principle
1. Operating principle of
of aa typical
typical tower
tower concentrating
concentrating solar
solar power
power (CSP)
(CSP) plant
plant [23].
[23].

2. LCOE Model for CSP Systems

2. LCOE Model for CSP Systems
The LCOE is one of the most frequently used characteristics to evaluate the electricity generation
The LCOE is one of the most frequently used characteristics to evaluate the electricity generation
cost of different technologies, which calculates the cost of electricity during the lifetime and takes
cost of different technologies, which calculates the cost of electricity during the lifetime and takes into
into account the time value of money and the risks. It is equal to the sum of all the discounted costs
account the time value of money and the risks. It is equal to the sum of all the discounted costs
incurred during the lifetime of the project divided by the units of discounted energy produced over
incurred during the lifetime of the project divided by the units of discounted energy produced over
the entire lifetime [24] and can be expressed as follows:
the entire lifetime [24] and can be expressed as follows:
− n −n
PN N h i
Ct +CLt ++L +  n=n1=1 ((VV+ +I I) )CCt (t1(+1r+) r)
= Pt = h N
LCOEt LCOE (1)
(1)

nn − n −n
TF )
i
N
S ·
n=1 n =1  S ⋅ TF
· η⋅η( 1 (1−− DR
DR )
) ( 1
( +
1 r
+ ) r 

where all the symbols in the equation are summarized in Table 1. The numerator includes the capital
cost of the system, land cost, operation and maintenance cost, and insurance cost. The denominator
also shows the sum of the real electricity generated during the lifetime of the plant divided by the
discount rate. The initial costs of the plant are considered as being paid up-front in this model,
Energies 2019, 12, 1394 4 of 17

where all the symbols in the equation are summarized in Table 1. The numerator includes the capital
cost of the system, land cost, operation and maintenance cost, and insurance cost. The denominator also
shows the sum of the real electricity generated during the lifetime of the plant divided by the discount
rate. The initial costs of the plant are considered as being paid up-front in this model, thereafter the
capital and land costs do not have to be discounted. However, the operation and maintenance and
insurance costs should be discounted as they are paid annually throughout the lifetime of the plant,
which can be evaluated at a constant percentage of the total cost of the system. In addition, the annual
electricity production can be directly calculated based on the available solar resource in cooperation
with the tracking factor, performance factor, and degradation rate.

Table 1. Parameters and their values of the levelized cost of electricity (LCOE) model.

Symbol Description Value Units

Levelized cost of electricity of a
LCOEt tower CSP system installed in the Calculated by Equation (1) RMB kWh−1
year t between 2017 and 2050
Capital cost of the system installed
Ct Calculated by Equation (2) RMB W−1
in the year t between 2017 and 2050
L Land cost In Table 3 RMB W−1
V Operation-maintenance cost 2 %
I Insurance cost 0.5 %
S DNI Calculated by Equation (7) kWh m−2 year−1
TF Tracking factor 100 %
η Performance factor Calculated by Equation (8) m2 W−1
DR Degradation rate 0.2 %
r Discount rate 10 %
N Lifetime of the system 30 years

2.1. Capital Cost of the CSP System

Several studies demonstrated that reduction in the capital costs of CSP plants can be characterized
by the learning curves [25,26] and the cost of a system installed in a certain year, Ct , can be described
as a function of the global cumulative installed capacity expressed as follows [6]:

! log (1−LR)
Qt log 2
Ct = C0 (2)
Q0

where Qt is the global cumulative installed capacity in a certain year (GW); Q0 is the cumulative
installed capacity in the reference year (GW); LR is the learning rate (%); C0 is the capital cost of the
CSP system installed in the reference year (RMB W−1 ). In this paper, the year of 2017 was taken as
the reference year and the capital cost of the LCOE present value was determined by C0 which was
calculated by System Advisor Model (SAM) of National Renewable Energy Laboratory (NREL) [23].

2.2. Cumulative Installed Capacity

The global cumulative installed capacity by the end of 2017 was reported to be 5.133 GW [2].
In order to evaluate the future cumulative installed capacity during the years of 2018–2050, four
scenarios of CSP development roadmap proposed by IEA are used and listed in Table 2. According to
Hernández-Moro et al. [6] and Li et al. [15], the logistic function of an S-shaped curve can describe the
objectives of cumulative installed capacity for Blue Map scenario and a 3-order polynomial equation
can fit the objectives for the other scenarios as follows:


 er(t−2010)
 1/0.82−1/M+er(t−2010) /M
Qt =  (3)
 k1 (t − 2010)3 + k2 (t − 2010)2 + k3 (t − 2010) + 0.82

Energies 2019, 12, 1394 5 of 17

Energies 2019, 12, x FOR PEER REVIEW 5 of 17

where t is the year and the parameters of r, M and ki (i = 1, 2, 3) are also summarized in Table 2.
It Advanced scenario
should be noticed is the
that most ambitious
the values calculatedbecause it considers
by Equation (3) wereall useful
only usedpolicies to CSP
for the years of technology,
2018–2050
(shown in Figure 2) when estimating the future evolution of LCOE, while Qt equaling to Q0 was usedof
along the lines of the industry’s recommendations, from around the world. The objective
atcumulative
the year ofinstalled capacity continues
2017 to calculate the presenttovalue
grow of
fast and reaches
LCOE. It can be1524 GW
seen bythe
that 2050. The Outlook
Global Blue Map
scenario has
Advanced the greatest
scenario increase
is the most of the because
ambitious cumulative installedall
it considers capacity during 2025
useful policies to CSP to 2040, but the
technology,
objective has seen little growth after 2045 and reaches 630 GW by 2050 which is less
along the lines of the industry’s recommendations, from around the world. The objective of cumulative than half of the
Global Outlook
installed capacityAdvanced
continues scenario.
to grow fast and reaches 1524 GW by 2050. The Blue Map scenario has
the greatest increase of the cumulative installed capacity during 2025 to 2040, but the objective has
Table
seen little 2. Cumulative
growth after 2045installed capacity
and reaches 630objectives
GW by 2050 of CSP systems
which inthan
is less International Energy
half of the Agency
Global Outlook
(IEA) scenarios and the parameters of their fitting functions.
Advanced scenario.
Blue Global Outlook Global Outlook
TableScenario
2. Cumulative installed
Mapcapacity objectives of CSP systems in International
Advanced
Roadmap
Energy Agency (IEA)
Moderate
scenarios and the2010
parameters of their fitting functions.
0.82 0.82 0.82 0.82
Objectives 2020 20 84Outlook
Global Global Outlook69 148
(GW) Scenario
2030 250 Blue Map 342 Roadmap
Advanced Moderate 231 337
2050 2010 630 0.82 1524
0.82 0.82 831 0.82 1089
Objectives 2020 20 84 69 148 k1 = 0.0104;
k1 = 0.0059; k1 = -0.0002;
(GW) 2030
R = 0.32; 250 342 231 337 k2 = -
Parameters 2050 k2 = 0.6972; 831 k2 = 0.4759;
M = 630 630 1524 1089 0.1016;
k3 = 0.7565 k3 = 2.0815
k1 = 0.0059; k1 = −0.0002; k1 = 0.0104; k3 = 14.6982
R = 0.32;
Parameters k2 = 0.6972; k2 = 0.4759; k2 = −0.1016;
M = 630
k3 = 0.7565 k3 = 2.0815 k3 = 14.6982

Figure 2. Fitting curves about cumulative installed capacity of CSP systems for four IEA scenarios in
Figure
the years2.
ofFitting curves about cumulative installed capacity of CSP systems for four IEA scenarios in
2018–2050.
the years of 2018–2050.
2.3. Learning Rate
2.3.The
Learning
rangeRate
of learning rate for solar thermal power tower technology is 5%–20% in the
literature [27–30].
The range ofInlearning
this study, wefor
rate used a conservative
solar estimation
thermal power of 10% recommended
tower technology is 5%–20% by IEAliterature
in the [20,22].
[27–30]. In this study, we used a conservative estimation of 10% recommended by IEA [20,22].
2.4. Land Cost
2.4.Many
Land Cost
geographic conditions need to be considered while selecting a potential location for installing
a tower CSP plant in China, including solar resource, water resource, energy demand, and power
Many geographic conditions need to be considered while selecting a potential location for
grid accessibility [15,19]. Water is a major concern in deciding on the cooling mode. Adopting the
installing a tower CSP plant in China, including solar resource, water resource, energy demand, and
dry cooling technology would increase the investment of 7%–9% and reduce the electricity output by
power grid accessibility [15,19]. Water is a major concern in deciding on the cooling mode. Adopting
5% [31]. The energy demand is another crucial factor for site selection. The eastern region of China
the dry cooling technology would increase the investment of 7%–9% and reduce the electricity output
has the most population and the highest energy demand. However, the northwestern part has the
by 5% [31]. The energy demand is another crucial factor for site selection. The eastern region of China
highest DNI.
has the most population and the highest energy demand. However, the northwestern part has the
highest DNI.
Energies 2019, 12, 1394 6 of 17
Energies 2019, 12, x FOR PEER REVIEW 6 of 17

In
In this
this study,
study, five
five locations
locations with
with different
different DNI
DNI values
values were
were selected
selected toto assess
assess the
the potential
potential for
for
installing tower CSP plants in China, which are Huizhou near Shenzhen,
installing tower CSP plants in China, which are Huizhou near Shenzhen, Taicang near Shanghai, Taicang near Shanghai,
Yanqing
Yanqing in in Beijing,
Beijing, Linxi
Linxi inin Inner
Inner Mongolia,
Mongolia, and and Delingha
Delingha in in Qinghai
Qinghai (as (as shown
shown in in Figure
Figure 3).
3). Four
Four of
of
them are located in eastern China where the electricity demand is relatively
them are located in eastern China where the electricity demand is relatively high, near cities with high, near cities with grid
transmission,
grid transmission, and sufficient water water
and sufficient resources in order
resources intoorder
analyze the economic
to analyze feasibilityfeasibility
the economic of building of
tower CSP plants in this region, particularly near the most developed
building tower CSP plants in this region, particularly near the most developed cities of China.cities of China. Delingha was
taken as a was
Delingha reference
takensite as where the annual
a reference DNI isthe
site where near the bottom
annual DNI is threshold
near theofbottom
2000 kWh m−2 year
threshold
−1 for
of 2000
installing
kWh m-2 any yearform
-1 forofinstalling
the CSP systems
any form to achieve
of the aCSPreasonable
systemseconomic
to achieve performance
a reasonable[32].economic
It can be
observed from Figure 3 that Huizhou and Taicang have relatively low DNI
performance [32]. It can be observed from Figure 3 that Huizhou and Taicang have relatively low among all the five locations.
Since DNI is all
DNI among thethemost
fiveimportant
locations.energy inputisdata
Since DNI for CSP
the most systemsenergy
important in SAM, the specific
input data forDNICSPfor those
systems
locations
in SAM, the arespecific
calculated DNIbyfor the method
those basedare
locations oncalculated
the air mass bywhich is introduced
the method based onlater. Then,
the air mass the land
which
areas required to build a tower CSP plant of 100 MW in different locations was
is introduced later. Then, the land areas required to build a tower CSP plant of 100 MW in different calculated by SAM and
shown in Table 3. It can be seen that the land price and unit land costs of
locations was calculated by SAM and shown in Table 3. It can be seen that the land price and unit Huizhou and Taicang were
much higher
land costs than the other
of Huizhou three locations.
and Taicang were much higher than the other three locations.

Figure 3.
Figure 3. Direct
Direct normal
normal irradiation
irradiation data
data for
for China
China (©
(© 2017
2017 The
The World
World Bank,
Bank, Solar
Solar resource
resource data:
data:
Solargis).

Table 3.
Table Land costs
3. Land costs for
for aa tower
tower CSP
CSP plant
plant of
of 100
100 MW
MW in
in different
different locations.
locations.
Location −1 )
-1)2 WLand m−2 )Cost Land −1
Location LandLand
Area Area
(m2 W(m Land
Price Price
(RMB m-2(RMB
） Land (RMBCost
W-1)(RMB W )
Huizhou
Huizhou 0.05460.0546 335 335 18.3 18.3
Taicang
Taicang 0.05540.0554 252 252 13.97 13.97
Yanqing
Yanqing 0.05730.0573 70.8 70.8 4.05 4.05
Linxi 0.0566 84 4.75
Linxi 0.0566 84 4.75
Delingha 0.0513 25.5 1.31
Delingha 0.0513 25.5 1.31

2.5. Operation and Maintenance Cost

2.5. Operation and Maintenance Cost
The operation and maintenance cost of CSP plants is lower than that of traditional power plants
The operation and maintenance cost of CSP plants is lower than that of traditional power plants
since fuel consumption is not necessary in CSP plants. This expense refers to the salary and welfare for
since fuel consumption is not necessary in CSP plants. This expense refers to the salary and welfare
the staff, the costs of water used for cooling and cleaning, plant operation costs, and field maintenance
for the staff, the costs of water used for cooling and cleaning, plant operation costs, and field
costs. The annual operation and maintenance cost was taken as 2% of the capital investment of the
maintenance costs. The annual operation and maintenance cost was taken as 2% of the capital
system, based on the reported values [6,33,34].
investment of the system, based on the reported values [6,33,34].

2.6. Insurance Cost

Since the CSP plants have relatively high technological risks in contrast with the conventional
power plants, an insurance policy should be considered. The insurance cost includes fixed assets
Energies 2019, 12, 1394 7 of 17

2.6. Insurance Cost

Energies 2019, 12, x FOR PEER REVIEW 7 of 17
Since the CSP plants have relatively high technological risks in contrast with the conventional
power plants,
insurance andanother
insurance policy
insurance should
which considered.
can be assumed The of
as 0.5% insurance cost
the capital includes fixed
investment of theassets
system
insurance
[35]. and other insurance which can be assumed as 0.5% of the capital investment of the system [35].

2.7.
2.7.Solar
SolarResource
Resource
The
TheDNI
DNIisisstrongly
stronglyaffected
affectedbybythe composition
the compositionofofatmosphere
atmosphereand
andthe
theweather
weathercorresponding
corresponding
totoa aspecific
specificlocation.
location.The
TheDNIDNIononthetheearth’s
earth’ssurface
surfacebetween
betweensunrise
sunriseand
andsunset
sunsetcan
canbebecalculated
calculated
according to the following experimentally determined equation
according to the following experimentally determined equation [36]: [36]:

(1 −(0.14h h )AM 0.14 h 

0.6780.678
D = 1.353 1 − 0.14 0.7 AM ++0.14h
h i
SD =S1.353 )0.7  (4)(4)

where
where h is
h is the
the location
location altitude
altitude above
above sea
sea level
level (m)
(m) and
and AMAM
is is
thethe
airair mass.
mass. AM AM
is is defined
defined asas [37]:
[37]:

AM = 1 1
AM = sin α + 0.50572(α + 6.07995 −1.6364
) (5)(5)
sin α + 0.50572(α + 6.07995◦ )−1.6364
where α is the solar elevation angle which can be calculated as a function of the solar declination
angle,α δ,
where is local
the solar elevation
latitude, angle
ϕ, and which
solar hourcan be calculated
angle, γ, [38]: as a function of the solar declination angle,
δ, local latitude, φ, and solar hour angle, γ, [38]:
α = sin −1 ( sin δ sin φ + cos δ cos φ cos γ ) (6)
α = sin−1 (sin δ sin φ + cos δ cos φ cos γ) (6)
The DNIs of summer solstice in Huizhou, Taicang, Yanqing, Linxi, and Delingha were calculated
by the
Theabove
DNIs mentioned
of summer method and
solstice in shown in
Huizhou, Figure Yanqing,
Taicang, 4. It can be seenand
Linxi, thatDelingha
the DNI were
at Linxi is higher
calculated
bythan
the that
above at mentioned
the other locations
method except for the
and shown in reference
Figure 4. It site
canDelingha.
be seen that the DNI at Linxi is higher
than that at the other locations except for the reference site Delingha.

Figure 4. Direct normal irradiances (DNIs) of summer solstice in different locations.

Figure 4. Direct normal irradiances (DNIs) of summer solstice in different locations.
Then, the annual DNI, S, as the integral of DNI along a year can be calculated as follows:
Then, the annual DNI, S, as the integral of DNI along a year can be calculated as follows:
Z t2
t
S = S = St DSdt
2

D dt (7)(7)
1
t1
where t1 and t2 indicate the beginning and end of the year, respectively. The annual DNI of Huizhou,
where t1 and t2 indicate the beginning and end of the year, respectively. The annual DNI of Huizhou,
Taicang, Yanqing, Linxi, and Delingha are shown in Table 4. It indicates that the annual DNI in
Taicang, Yanqing, Linxi, and Delingha are shown in Table 4. It indicates that the annual DNI in
Delingha is much higher than other sites. The annual DNIs in Taicang and Huizhou are even lower
Delingha is much-2higher than other sites. The annual DNIs in Taicang and Huizhou are even lower
than 800 kWh m −2 year−1
-1.
than 800 kWh m year .
Table 4. Annual DNIs of different locations.

Location Huizhou Taicang Yanqing Linxi Delingha

S (kWh m-2 year-1) 795.7 762.9 1189.9 1668.1 2080.5

2.8. Tracking Factor

Energies 2019, 12, 1394 8 of 17

Table 4. Annual DNIs of different locations.

Location Huizhou Taicang Yanqing Linxi Delingha

S (kWh m−2 year−1 ) 795.7 762.9 1189.9 1668.1 2080.5

2.8. Tracking Factor

As the CSP systems can only use DNI, the tracking system is critical for CSP plants. For tower
systems, azimuth-altitude dual axis solar tracking mechanisms are employed for the heliostat. Hence,
the tracking accuracy to the sunlight is high and the tracking factor is one [33].

2.9. Performance Factor

The performance factor can be calculated as follows:

Electricity produced per installed watt (kWh W−1 )

η= (8)
Solar resource utilized per year (kWh m−2 )

For CSP systems, the utilized solar resource approximates to the DNI. And the electricity
production per installed watt can be obtained by dividing the annual electrical output to the power of
the plant. The electrical output was estimated by SAM, which was not characterized by the solar field
but by the power of the turbines. In addition, since value of the performance factor is relevant to TES,
the range of 0–10 h of TES capacity was evaluated.

2.10. Degradation Rate

Because of degradation, the annual electrical output of CSP systems would be slightly diminished.
The recommended value of degradation rate was 0.2% mainly owing to the degradation of turbines [7].

2.11. Discount Rate

The discount rate is used to consider the time value of money and the risk of the investment.
According to IEA [34], the discount rate is between 10% and 15% for CSP systems. A conservative
value of 10% was adopted in the present paper.

2.12. Lifetime of the System

For CSP systems, the common lifetime is in the range of 25–40 years [22,33,34,39,40]. In this study,
a lifetime of 30 years was used as suggested by most similar studies.

3. Results and Discussion

On the basis of the LCOE model described above, the economic analysis of 100 MW tower CSP
plants in five locations in China with four different molten-salts for TES was estimated. Calculation
results of both the LCOE present value in 2017 and its future evolution over the period of 2018–2050
under four scenarios proposed by the IEA were also presented. Moreover, the specific time when CSP
grid parities can be attained was estimated and influences of the land cost, TES capacity, learning rate,
discount rate, lifetime, degradation rate, operation-maintenance cost, and insurance cost on the LCOE
were examined. As the reference, a 100 MW plant using solar salt (NaNO3 -KNO3 , 60-40 wt.%) with 6 h
TES in Delingha was used in this study. Unless otherwise stated, the values for the input parameters of
Equation (1) were used as specified in Table 1.
Table 5 shows the initial costs and LCOE present values for different locations under reference
conditions. It can be seen that the initial costs of Huizhou and Taicang were much higher than that
of Delingha which is mainly due to expensive land cost. The influence of land cost on the LCOE is
illustrated in Figure 5. The x axis shows the percentage of the land cost reduction. It was found that
the land cost affected the LCOE significantly for Huizhou and Taicang as their land costs accounted
Energies 2019, 12, 1394 9 of 17

for 38.8% and 30.8% of their total initial capital investment, respectively. Furthermore, the LCOE
in Huizhou and Taicang was still higher than 6 RMB kWh−1 even if the land cost dropped to zero.
It was mainly because the DNI in both locations is less than 800 kWh m−2 year−1 , which makes the
capacity factor relatively low. Thus, it is inappropriate to install a tower CSP plant nearby Shenzhen
and Shanghai regardless of the land cost. It can also be observed from Figure 5 that the land cost had a
Energies 2019, 12, x FOR PEER REVIEW 9 of 17
slight influence on the LCOE of CSP plants in Yanqing, Linxi, and Delingha. Yanqing is the selected
location of the
the eastern of first
China.pilot CSP plant
Therefore, in Beijing
it can and the that
be concluded landthe
costmajor
is quite low.resulting
factor The LCOE of Linxi
in low LCOE hadfor
the lowest value of 2.33 RMB kWh −1 because of its highest DNI among the four selected locations at
different locations is the high DNI, which leads to more produced energy, higher capacity factor, and
the eastern
more of China.
efficient TES. Therefore, it can be concluded that the major factor resulting in low LCOE for
different locations is the high DNI, which leads to more produced energy, higher capacity factor, and
more efficient TES. Table 5. Initial costs and LCOE present values for different locations in China.

System
Table 5. Initial costs LCOELand
andcost cost
present values LCOE
for different
2017 Capacityinfactor
locations China.
Location
(RMB W-1) (RMB W-1) (RMB kWh-1) (%)
Location Huizhou System Cost
31.48 Land
18.3 Cost 9.28 LCOE2017−17.6 Capacity Factor
(RMB W−1 ) (RMB W−1 ) (RMB kWh ) (%)
Taicang 31.45 13.97 8.49 7.7
Huizhou Yanqing 31.48 31.38 18.3
4.05 3.5 9.28 15.1 7.6
Taicang 31.45 13.97 8.49 7.7
Linxi 31.24 4.75 2.33 23
Yanqing 31.38 4.05 3.5 15.1
Linxi Delingha 31.24 30.6 1.31
4.75 1.45 2.33 33.3 23
Delingha 30.6 1.31 1.45 33.3

Figure 5. Effect of land cost on the LCOE for five different sites.
Figure 5. Effect of land cost on the LCOE for five different sites.
The TES unit is an important sub-system of CSP plants which guarantees dispatchable electricity
supply. Moreover,
The TES unit ishigh heat transfer
an important fluid (HTF)
sub-system operating
of CSP temperature
plants which in a CSP
guarantees plant is beneficial
dispatchable electricity
because
supply.itMoreover,
can improve highthe heat
heat to electricity
transfer conversion
fluid (HTF) efficiency.
operating The U.S.
temperature in aDepartment
CSP plant isofbeneficial
Energy
(DOE)
because suggested that the the
it can improve appropriate HTF candidates
heat to electricity mustefficiency.
conversion be thermally Thestable at temperatures
U.S. Department up to
of Energy
720 ◦ C [41]. In the present
(DOE) suggested that thestudy, four molten-salt
appropriate eutectic must
HTF candidates mixtures were selected
be thermally as at
stable thetemperatures
energy storage up
media
to 720to°Cestimate
[41]. Inthe
thecorresponding
present study,LCOE. Except for solar
four molten-salt saltmixtures
eutectic which was wereselected as the
selected reference,
as the energy
the othermedia
three salts all havethe
thecorresponding
temperature of thermal stability higher ◦ C and show the
storage to estimate LCOE. Except for solar saltthan 715was
which selected as the
potential
reference, tothe
be used
otherin commercial
three CSP plants
salts all have which has of
the temperature been reported
thermal in previous
stability studies
higher than 715[42–46].
°C and
showthermophysical
Their the potential to properties
be used in and
commercial
TES costs CSP
areplants
listedwhich
in Table has6 been reported
[1,42–47]. in be
It can previous studies
seen that the
[42–46]. Their thermophysical properties
chloride-salt mixture (NaCl-KCl-ZnCl 2 , and TES costs are listed in Table 6 [1,42–47]. It can be seen
8.1-31.3-60.6 wt.%) has the lowest TES cost due to the lowest
thatprice
salt the chloride-salt mixtureAnd
and largest density. (NaCl-KCl-ZnCl
the TES costs2,of 8.1-31.3-60.6 wt.%)mixture
the fluoride-salt has the (LiF-NaF-KF,
lowest TES cost due to the
29.3-11.7-59
lowest
wt.%) saltcarbonate-salt
and price and largest density.
mixture And
(Li2 CO 3 the
-Na 2 TES
CO costs
-K
3 2 CO of
3 ,the fluoride-salt
32.1-33.4-34.5 mixture
wt.%) are (LiF-NaF-KF,
much higher 29.3-
since
11.7-59
their salt wt.%) andmore
prices are carbonate-salt mixture
than three times (Li2prices
of the CO3-Na of2CO
solar3-K 2CO
salt 3, 32.1-33.4-34.5
and wt.%) are much
chloride-salt mixture.
higher since their salt prices are more than three times of the prices of solar salt and chloride-salt
mixture.

Table 6. Thermal properties and thermal energy storage (TES) costs of selected molten-salts.

NaNO3- Li2CO3-Na2CO3- NaCl-KCl-

Molten-Salt LiF-NaF-KF
KNO3 K2CO3 ZnCl2
29.3-11.7-
Energies 2019, 12, 1394 10 of 17

Energies 2019, 12, x FOR PEER REVIEW 10 of 17

Table 6. Thermal properties and thermal energy storage (TES) costs of selected molten-salts.
1851.6-
Density
Molten-Salt
(kg m-3) 1708.4-1950.1 LiF-NaF-KF
NaNO3 -KNO3
1959.7-2069.4
Li2 CO3 -Na2 CO3 -K2 CO3
1946.2-2275.5
NaCl-KCl-ZnCl2
2116.5
Composition
Heat capacity by(kJ
wt.%
kg-1 K-1) 60-40
1.48-1.55 29.3-11.7-59.0
1.28-1.82 32.1-33.4-34.5
1.61 8.1-31.3-60.6
0.9-0.92
Melting point (◦ C) 220 454 400 229
Viscosity (mPa
◦
Thermal stability ( C)
s) 0.99-5.78
600
1.64-12.38
850
6.11-45.09
715
3.48-29.63
850
Thermal conductivity
Density (kg m−3 ) (W m K 1708.4-1950.1
-1 -
1851.6-2116.5 1959.7-2069.4 1946.2-2275.5
0.33-0.40 0.05-0.27 0.45-0.49 0.30-0.38
Heat capacity (kJ1)kg−1 K−1 ) 1.48-1.55 1.28-1.82 1.61 0.9-0.92
Viscosity (mPa s) 0.99-5.78 1.64-12.38 6.11-45.09 3.48-29.63
Salt price (RMB kg-1) 5.80 16.66 15.02 4.68
Thermal conductivity (W m−1 K−1 ) 0.33-0.40 0.05-0.27 0.45-0.49 0.30-0.38
TES cost (RMB
Salt price (RMB kg ) kWh
−1 t -1) 156.00
5.80 316.79
16.66 490.15
15.02 4.68111.69
TES cost (RMB kWht −1 ) 156.00 316.79 490.15 111.69

Figure 6 and Figure 7 indicate the effect of TES capacity on the performance factor and LCOE
present
Figuresvalue
6 andusing different
7 indicate the salt mixtures
effect as the energy
of TES capacity on thestorage media factor
performance under and
reference
LCOEconditions.
present
value using different salt mixtures as the energy storage media under reference conditions. It can of
It can be found that the performance factor of solar salt which has a much lower temperature
be thermal
found that stability is higher than
the performance factorthat of the
of solar fluoride-salt
salt which has amixturemuch lowerand chloride-salt
temperature of mixture.
thermalThe
chloride-salt mixture with the lowest performance factor has the highest LCOE
stability is higher than that of the fluoride-salt mixture and chloride-salt mixture. The chloride-salt when the CSP system
has no
mixture TES.
with theSince
lowest a larger capacity
performance TES has
factor unitthe
improves the performance
highest LCOE when the CSP factor of CSP
system hassystems
no TES. as
confirmed
Since by other TES
a larger capacity studies
unit[48,49]
improves thenthe the LCOE of allfactor
performance molten-salts decreases
of CSP systems as as the capacity
confirmed of TES
by other
increases. However, when the performance factor no longer improves along
studies [48,49] then the LCOE of all molten-salts decreases as the capacity of TES increases. However, with the increasing TES
capacity,
when then LCOEfactor
the performance goes up,
no thereafter,
longer improves as the cost
along ofwith
the TESthe rises. Thus,TES
increasing there is an optimal
capacity, capacity
then LCOE
of up,
goes TESthereafter,
resulting in asthe
thelowest
cost ofLCOE.
the TES The LCOE
rises. Thus,of the
therechloride-salt
is an optimal mixture reduces
capacity of TES sharply before
resulting
in the lowest LCOE. The LCOE of the chloride-salt mixture reduces sharply before the TES capacitythe
the TES capacity reaches the optimal value because of its comparably lowest salt price. As such,
increasing
reaches trendsvalue
the optimal of thebecause
LCOEsof ofits
thecomparably
fluoride-salt and carbonate–salt
lowest mixtures
salt price. As such, are more trends
the increasing remarkable
of
the LCOEs of the fluoride-salt and carbonate–salt mixtures are more remarkable when the TES capacitythe
when the TES capacity is higher than the optimal value due to their high costs. The solar salt has
lowestthan
is higher LCOE theamong
optimal those
valuefour molten-salts
due to their high regardless
costs. The of the
solarTES capacity.
salt has the lowest LCOE among
those four molten-salts regardless of the TES capacity.

Figure 6. Influence of TES capacity on the performance factor for four different molten-salts.
Figure 6. Influence of TES capacity on the performance factor for four different molten-salts.
 Energies 2019, 12, x FOR PEER REVIEW 11 of 17

Energies 2019, 12, x FOR PEER REVIEW 11 of 17

Energies 2019, 12, 1394 11 of 17

Figure 7. Influence of TES capacity on the LCOE for four different molten-salts.
Figure 7. Influence of TES capacity on the LCOE for four different molten-salts.
Figure 7.
Figure 8 shows Influence
the evolutionof TES
of capacity
the LCOE on the LCOE for
between 2017 four
anddifferent
2050 atmolten-salts.
four different scenarios
under reference
Figure 8 shows conditions.
the evolutionIt can of
bethe
deduced
LCOEthat the future
between 2017 cost
and of tower
2050 CSP different
at four electricityscenarios
decreases
Figure 8 shows the evolution of the LCOE between 2017 and 2050 at four different scenarios
as the global cumulative installed CSP capacity increases during the period of
under reference conditions. It can be deduced that the future cost of tower CSP electricity decreases 2018-2050. Moreover,
under reference conditions. It can be deduced that the future cost of tower CSP electricity decreases
asthe
thefuture
globalLCOE in the Blue
cumulative mapCSP
installed scenario presents
capacity a slower
increases reduction
during thanof
the period the other three
2018-2050. scenarios,
Moreover,
as the global cumulative installed CSP capacity increases during the period of 2018-2050. Moreover,
particularly
the future LCOE in in
thetheinitial
Blue mapyears,scenario
owing presents
to the lower objectives
a slower reduction of than
the CSP installation
the other capacity.
three scenarios,
the future LCOE in the Blue map scenario presents a slower reduction than the other three scenarios,
However, the difference of the LCOE at different scenarios becomes quite small in
particularly in the initial years, owing to the lower objectives of the CSP installation capacity. However, 2050. The LCOE
particularly in the initial years, owing to the lower objectives of the CSP installation capacity.
ofdifference
the tower CSPofsystems
the LCOE areat0.72, 0.64, 0.70,
different and 0.67
scenarios RMB quite
becomes kWh small
-1 in 2050 and represents
in 2050. The LCOE49.88%,
of tower44.02%,
CSP
However, the difference of the LCOE at different scenarios becomes quite small in 2050. The LCOE
47.94%, and 46.14% of its present value in 2017
−1 for
systems are 0.72, 0.64, 0.70, and 0.67 RMB kWh in 2050 and represents Blue map scenario, Global outlook advanced
49.88%, 44.02%, 47.94%, and
of tower CSP systems are 0.72, 0.64, 0.70, and 0.67 RMB kWh-1 in 2050 and represents 49.88%, 44.02%,
scenario,
46.14% Global
of its presentoutlook
valuemoderate
in 2017 forscenario,
Blue map and Roadmap
scenario, scenario,
Global outlookrespectively.
advanced scenario, Global
47.94%, and 46.14% of its present value in 2017 for Blue map scenario, Global outlook advanced
outlook moderate scenario, and Roadmap scenario, respectively.
scenario, Global outlook moderate scenario, and Roadmap scenario, respectively.

Figure 8. Future evolution of the LCOE for tower CSP systems and grid parities at four scenarios (solid
Figure 8. Future evolution of the LCOE for tower CSP systems and grid parities at four scenarios
line: tower CSP plants; dash line: coal-fired power plants).
(solid line: tower CSP plants; dash line: coal-fired power plants).
Figure 8. Future evolution of the LCOE for tower CSP systems and grid parities at four scenarios
Figure
(solid
8 also illustrates the time whencoal-fired
the electricity cost of tower CSP plants will reach the grid
Figureline: tower
8 also CSP plants;
illustrates thedash
timeline: power plants).
when the electricity cost of tower CSP plants will reach the grid
parity under reference conditions. Since more than three quarters of the electricity is generated by
parity under reference conditions. Since more than three quarters of the electricity is generated by
coal-fired power
Figure plants
8 also in China
illustrates the[34],
timethe
whencostthe
evolution of cost
electricity coal-fired
of towerelectricity waswill
CSP plants usedreach
as the
thegrid
grid
coal-fired power plants in China [34], the cost evolution of coal-fired electricity was used as −1 the grid
parity
parityinunder
this study. The cost
reference of electricity
conditions. Sinceproduced
more thanby coal-fired powerofplants
three quarters is 0.41 RMB
the electricity kWh [50]by
is generated
parity in this study. The cost of electricity produced by coal-fired power plants is 0.41 RMB kWh-1 [50]
which is only
coal-fired considered
power plantsthe production
in China costs
[34], the andevolution
cost would increase linearly
of coal-fired in the future
electricity was with
usedanas annual
the grid
which is only considered the production costs and would increase linearly in the future with an
conservative growth rate of 2.7% [15]. In addition, considering the CO emissions by
parity in this study. The cost of electricity produced by coal-fired power2 plants is 0.41 RMB kWh-1 [50] the coal-fired
annual conservative growth rate of 2.7% [15]. In addition, −1 considering the CO2 emissions−1by the coal-
power
whichplants,
is onlythe carbon emission
considered prices of costs
the production 162.5 RMB ton CO
and would 2 [51] and
increase 325 RMB
linearly in theton COwith
future 2 [20]an
fired power plants, the carbon emission prices of 162.5 RMB ton-1 CO2 [51] and 325 RMB−1ton-1 CO2 [20]
were added to estimate the grid parities with an emission factor of 0.9
annual conservative growth rate of 2.7% [15]. In addition, considering the CO2 emissions kg CO 2 kWh [34,52,53].
by the coal-
were added to estimate the grid parities with an emission factor of 0.9 kg CO2 kWh-1 [34,52,53].
According
fired power to Figure
plants, 8,thethe time emission
carbon when theprices
grid parities
of 162.5of tower
RMB tonCSP
-1 CO systems
2 [51] andwould be achieved
325 RMB ton-1 CO2are[20]
were added to estimate the grid parities with an emission factor of 0.9 kg CO2 kWh-1 [34,52,53].
 Energies 2019, 12, x FOR PEER REVIEW 12 of 17

According to Figure 8, the time when the grid parities of tower CSP systems would be achieved are
Energies 2019, 12, 1394 12 of 17
summarized in Table 7. It can be observed that the LCOE of tower CSP would reach the grid parity
in the years of 2038–2041 in the case of no future penalties for CO2 emissions. And the grid parity
would bringinforward
summarized Table 7.about
It can7–8 years for the
be observed thatcarbon emission
the LCOE priceCSP
of tower of 162.5
wouldRMB tonthe
reach -1 CO2 and
grid about
parity
in13–14 yearsoffor
the years the carbon
2038–2041 in emission price
the case of of 325 RMB
no future ton-1 for
penalties COCO2. 2 emissions. And the grid parity

would bring forward about 7–8 years for the carbon emission price of 162.5 RMB ton−1 CO2 and about
Table
13–14 years for the 7. Time
carbon when the
emission gridofparities
price 325 RMB ton−1CSP
of tower COsystems
2. would be achieved.

Time When LCOE Equals to the Grid Parity

Scenario
Table 7. Time when the grid parities of tower CSP systems would be achieved.
0 RMB ton-1 CO2 162.5 RMB ton-1 CO2 325 RMB ton-1 CO2
Blue map 2040 2032 to the Grid Parity2028
Time When LCOE Equals
Scenario
0 RMB ton−1 CO
Global outlook advanced 20382 162.5 RMB ton−1 CO2
2031 RMB ton−1 CO2
325 2025
Blue map 2040 2032 2028
Global outlook moderate 2041 2033 2027
Global outlook advanced 2038 2031 2025
Global outlook moderate
Roadmap 2041 2040 2033
2031 20242027
Roadmap 2040 2031 2024
In order to evaluate the influence of learning rate on the LCOE for tower CSP systems, the LCOE
in the year to
In order of evaluate
2050 withthethe learning
influence ofrate ranging
learning rate from
on the5% to 20%
LCOE under CSP
for tower reference conditions
systems, the LCOE are
inestimated
the year ofat four
2050scenarios
with the and shown
learning in Figure
rate ranging9. from
It illustrates that the
5% to 20% LCOE
under reduces
reference as the learning
conditions are
rate increases and the reduction rates are 66.4%, 71.8%, 68.2%, and 69.9% for Blue map
estimated at four scenarios and shown in Figure 9. It illustrates that the LCOE reduces as the learning scenario,
Global
rate outlook
increases advanced
and the reductionscenario,
rates areGlobal outlook
66.4%, 71.8%, moderate
68.2%, scenario,
and 69.9% and
for Blue mapRoadmap
scenario,scenario,
Global
respectively.
outlook advancedThescenario,
result indicates that this
Global outlook parameter
moderate has aand
scenario, significant
Roadmapeffect on the
scenario, economic
respectively.
feasibility
The of towerthat
result indicates CSPthis
plants.
parameter has a significant effect on the economic feasibility of tower
CSP plants.

Figure 9. Effect of learning rate on the LCOE for four scenarios.

Figure 9. Effect of learning rate on the LCOE for four scenarios.
Some studies in the literature [49,54,55] claimed that the discount rate is one of the most significant
Some studies in the literature [49,54,55] claimed that the discount rate is one of the most
variables affecting the LCOE of the CSP systems, which reflects the risk-adjusted opportunity of capital
significant variables affecting the LCOE of the CSP systems, which reflects the risk-adjusted
investment. Figure 10 shows that the present value of LCOE under reference conditions rises about 35%
opportunity of capital investment. Figure 10 shows that the present value of LCOE under reference
when the discount rate increases from 10% to 15%. Although the discount rate for the CSP technology
conditions rises about 35% when the discount rate increases from 10% to 15%. Although the discount
is relatively high for now, it is expected to decline in the future as CSP markets develop and the related
rate for the CSP technology is relatively high for now, it is expected to decline in the future as CSP
technologies become more mature.
markets develop and the related technologies become more mature.
 Energies 2019, 12, x FOR PEER REVIEW 13 of 17

Energies 2019, 12, x FOR PEER REVIEW 13 of 17

Energies 2019, 12, 1394 13 of 17

Figure 10. Influence of discount rate on the LCOE.

Figure 10. Influence of discount rate on the LCOE.
Figure 10. Influence
In order to study the sensitivity of discount
of the LCOE rate lifetime
with the on the LCOE.
of tower CSP plants, the LCOE
present value
In order toin different
study lifetime expectations
the sensitivity of the LCOE under
withreference conditions
the lifetime of towerwere
CSPestimated andLCOE
plants, the shown
In order to study the sensitivity of the LCOE with the lifetime of tower CSP plants, the LCOE
in Figure
present 11.inItdifferent
value can be seen thatexpectations
lifetime the LCOE isunderless sensitive
referencetoconditions
the lifetime. Asestimated
were the life time
andincreases
shown
present value in different lifetime expectations under reference conditions were estimated and shown
infrom 25 11.
Figure to 40
It years,
can bethe LCOE
seen that only reduces
the LCOE by 5.6%.
is less sensitive to the lifetime. As the life time increases
in Figure 11. It can be seen that the LCOE is less sensitive to the lifetime. As the life time increases
from 25 to 40 years, the LCOE only reduces by 5.6%.
from 25 to 40 years, the LCOE only reduces by 5.6%.

Figure 11.11.Effect
Figure Effectofof
lifetime onon
lifetime the LCOE.
the LCOE.

Figure 12 displays the impactsFigure

of degradation
Effect ofrate, operation-maintenance cost, and insurance cost
Figure 12 displays the impacts of11. degradation lifetime
rate, on the LCOE.
operation-maintenance cost, and insurance
on the LCOE for tower CSP systems. The variables are changed within the range of −20% to 20% with
cost on the LCOE for tower CSP systems. The variables are changed within the range of -20% to 20%
an interval
Figureof 12
5%displays
around reference conditions.
the impacts It can be
of degradation seen
rate, that the effect of operation-maintenance
operation-maintenance cost, and insurance
with an interval of 5% around reference conditions. It can be seen that the effect of operation-
cost
costison
greater than that
the LCOE of other
for tower CSPtwo factorsThe
systems. andvariables
the influence of the degradation
are changed rate isofthe
within the range smallest.
-20% to 20%
maintenance cost is greater than that of other two factors and the influence of the degradation rate is
One
withwayantointerval
reduce of the5%
operation-maintenance cost is to It
around reference conditions. improve
can bethe level
seen of the
that management and use
effect of operation-
the smallest. One way to reduce the operation-maintenance cost is to improve the level of
high quality CSP
maintenance equipment.
cost is greater than that of other two factors and the influence of the degradation rate is
management and use high quality CSP equipment.
the smallest. One way to reduce the operation-maintenance cost is to improve the level of
management and use high quality CSP equipment.
 Energies 2019, 12, x FOR PEER REVIEW 14 of 17
Energies 2019, 12, 1394 14 of 17

Figure 12. Sensitivity analysis of degradation rate, operation-maintenance cost, and insurance cost.
Figure 12. Sensitivity analysis of degradation rate, operation-maintenance cost, and insurance cost.
4. Conclusions
4. Conclusions
In order to provide support information for the Chinese government to formulate incentive
policiesIn fororder
the CSP to provide
industry,support
we haveinformation
presented the foreconomic
the Chinese government
analysis based on to theformulate
LCOE model incentive
for
policies for the CSP industry, we have presented the economic
100 MW tower CSP plants in the locations of Huizhou near Shenzhen, Taicang near Shanghai, Yanqing analysis based on the LCOE model
in for 100 MW
Beijing, Linxitower
in Inner CSP plants inand
Mongolia, the Delingha
locations in of Qinghai
Huizhouinnear Shenzhen,
China with fourTaicang near eutectic
molten-salt Shanghai,
Yanqing
mixtures ofinthe
Beijing, Linxi in mixture
chloride-salt Inner Mongolia, and Delingha
(NaCl-KCl-ZnCl in Qinghai in China with four molten-salt
2 , 8.1-31.3-60.6 wt.%), fluoride-salt mixture
eutectic mixtures of the chloride-salt mixture
(LiF-NaF-KF, 29.3-11.7-59 wt.%), carbonate-salt mixture (Li2 CO3 -Na22CO (NaCl-KCl-ZnCl , 8.1-31.3-60.6 wt.%), fluoride-salt
3 -K2 CO3 , 32.1-33.4-34.5 wt.%),
mixture (LiF-NaF-KF, 29.3-11.7-59 wt.%), carbonate-salt mixture
and solar salt (NaNO3 -KNO3 , 60-40 wt.%) as the energy storage media. Major conclusions were (Li 2CO3-Na2CO3-K2CO3, 32.1-33.4-

34.5 wt.%),as
summarized and solar salt (NaNO3-KNO3, 60-40 wt.%) as the energy storage media. Major conclusions
follows:
were summarized as follows:
(1)(1) It It
is is
inappropriate
inappropriate to to
build
builda tower
a tower CSP
CSP plant
plantnearby
nearby Shenzhen
Shenzhen andandShanghai.
Shanghai. Even
Evenif the land
if the land
costs drop to zero, the LCOEs would be still higher than 6 RMB kWh −1 mainly owing to the
costs drop to zero, the LCOEs would be still higher than 6 RMB kWh-1 mainly owing to the
relatively
relatively low low DNIDNI of oflessless
than 800800
than kWh kWh m−2myear −1
-2 year.-1.The
Theimpact
impactofofDNIDNI ononthethe
LCOELCOE is much
is much
more significant than the other influence
more significant than the other influence factors. factors.
(2)(2) There
There is an
is anoptimal
optimal capacity
capacity of TES resulting
of TES resultingin thein lowest
the lowestLCOE for afor
LCOE certain towertower
a certain CSP plant, as
CSP plant,
theasperformance factor increases with the increasing TES capacity and
the performance factor increases with the increasing TES capacity and then becomes stable. then becomes stable. The
solar
Thesalt has
solar thehas
salt lowest LCOELCOE
the lowest among those those
among four molten-salts regardless
four molten-salts of theof
regardless TES
thecapacity.
TES capacity.
(3)(3) The LCOE of tower CSP would reach the grid parity in
The LCOE of tower CSP would reach the grid parity in the years of 2038–2041 in thethe years of 2038–2041 in the case of of
case nono
future penalties for the CO emissions based on the four scenarios
future penalties for the2 CO2 emissions based on the four scenarios for CSP development for CSP development roadmap
proposed
roadmapbyproposed IEA. As by such,IEA. theAsgrid parity
such, would
the grid be brought
parity would be forward
brought about 7–8 years
forward about for7-8 the
years
carbon emission price of 162.5 RMB ton −1 CO and-1about 13–14 years for the carbon emission
for the carbon emission price of 162.5 RMB2 ton CO2 and about 13–14 years for the carbon
price of 325 price
RMBof ton −1
emission 325 CORMB 2 . ton-1 CO2.
(4)(4) TheTheLCOELCOE of ofthethetower
tower CSP CSP systems
systems is significantly
is significantly affected byby
affected thethe
learning
learningrate and
rate discount
and discount
rate, yet it is less sensitive to the lifetime. Moreover, the impact of
rate, yet it is less sensitive to the lifetime. Moreover, the impact of operation-maintenanceoperation-maintenance cost is is
cost
greater
greater than
than that
thatof of
insurance
insurance cost and
cost and degradation
degradation rate.
rate.
Incentive
Incentive policy
policy is aiscrucial
a crucial force
force for rapid
for the the rapid development
development of theofCSP
the industry
CSP industry and reducing
and reducing the
the LCOE of CSP plants. Further studies can be conducted to evaluate the impacts
LCOE of CSP plants. Further studies can be conducted to evaluate the impacts of incentive policies of incentive
for
policies
CSP projectsforinCSP projects
China, such asin investment
China, suchandas production
investmenttaxes
and production taxes credit,
credit, cash incentives, cashorincentives,
sales, use tax
sales, orand
reduction usedifferent
tax reduction and different
depreciation modes. depreciation modes.
Author Contributions: Conceptualization, X.Z. and X.X.; methodology and investigation, X.Z.; resources and
Author Contributions: Conceptualization, X.Z. and X.X.; methodology and investigation, X.Z.; resources and
data
data curation,
curation, W.L.;
W.L.; writing—original
writing—original draft
draft preparation,
preparation, X.Z.;
X.Z.; writing—review
writing—review and
and editing,
editing, X.X.;
X.X.; supervision,
supervision,
W.X.;
W.X.; project
project administration,
administration, X.X.;
X.X.; funding
funding acquisition,
acquisition, X.Z.X.Z.
andand
X.X.X.X.
Funding:
Funding: This
This research
research waswas funded
funded by by National
National Natural
Natural Science
Science Foundation
Foundation of China,
of China, grant
grant number
number 51706056
51706056
andand
China Postdoctoral
China Science
Postdoctoral Foundation,
Science grant
Foundation, number
grant 2018M631927.
number 2018M631927.
Energies 2019, 12, 1394 15 of 17

Conflicts of Interest: The authors declare no conflict of interest.

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